According to Russia’s state committee on statistics, the figure for Russians living below the poverty line went up to 24.5 million during the first three months of this year – a steep increase from 18.5 million by the end of 2008.
The rise follows years in which Russians saw their living standards improve under the former president Vladimir Putin (now prime minister), largely thanks to a buoyant oil price, and Russia’s status as the world’s largest gas exporter. This improvement has now come to a juddering halt. More Russian families than ever before are sliding into poverty – defined as an adult income of less than 5,497 roubles or €125 a month.
Writing in Kommersant newspaper, the economist Dmitry Butrin said Mr Putin’s relative success in fighting poverty over the last decade had been reversed: “The official poverty rate has gone up by precisely six million people. All of the gains in fighting poverty during the period 2000-2008 have been utterly wiped out.”
Russia’s economy shrank by about 9.5 per cent in the first quarter of this year. It has pumped millions of dollars into bailing out its banking sector and helping strategic businesses, many owned by well-connected oligarchs.
The Kremlin has recently been encouraged by a recovery in the price of oil to $70 a barrel – enough for it to maintain its federal budgets. There are also signs employment figures, sinking since last autumn, began rising in April.
One economist said the significance of the poverty figures should not be exaggerated. He said they concealed wide regional differences in a country which has huge disparities in income between the elite, living in Moscow and St Petersburg, and those in crumbling villages and single-factory industrial towns.
According to Natalia Zubarevich, a professor of economic geography at Moscow’s state university, Russians are adept at dealing with crises – many grow vegetables in small kitchen gardens to survive.
The rise in poverty levels did not pose a serious political challenge to the Kremlin, she said. “The (state-controlled) Russian media is quite clear who is responsible for the crisis. Foreigners are responsible, enemies are responsible and big business, especially, is responsible. But not Putin.” – (Guardian service)